Driver Carlos Bermudez brings coffee beans in from a van to Graffeo Coffee in North Beach. The oldest artisan coffee roaster in the United States, opened in 1935, Graffeo is a landmark in one of the city's most storied neighborhoods.

Photo: Liz Hafalia, The Chronicle

Driver Carlos Bermudez brings coffee beans in from a van to Graffeo...

If I was going to pick one square to explain the quirkiness, vibrancy and ethos of San Francisco, it would be Square 5.

Here lies the heart and soul of San Francisco. This square mile encapsulates the city's beginnings, its forced acceptance of ethnic diversity, its independent entrepreneurial spirit, its love of life.

A sociologist could work for years to unpeel the layers of these blocks, which include the major portion of Chinatown, North Beach, Fisherman's Wharf and Jackson Square.

It's where Portsmouth Square is located. Today it's known as the heart of Chinatown, but when it was established in the early 1800s in the Mexican community known as Yerba Buena, it was the emerging city's first public square. It's where the first public school in California was erected and where the discovery of gold was announced. It's the focus of an area that's grown, expanded, adapted and remains vibrant even today.

Square 5 also includes what was known as the Barbary Coast, the red-light district. It was the site of dozens of houses of prostitution, which I contend have contributed to our present-day attitudes about food.

The various houses would try to distinguish themselves by offering a "free lunch" to patrons, who would then go upstairs to be entertained by the girls; food and pleasure became inextricably linked in San Francisco as nowhere else in the country.

Glimmers of this freewheeling lifestyle can still be found on Broadway in North Beach and in such businesses as the Saloon on upper Grant, which is the city's oldest bar. Today Square 5 also includes places like 15 Romolo, the first of a new breed of dive bars that take cocktails seriously.

Chinatown was established in 1848, the same year the Gold Rush began. A few years later, old St. Mary's was built, the first church in the United States to cater to the Asian community. And the firsts continued: In 1920, Hang Ah Tea Room opened on Pagoda Place, supposedly the first dim sum house in the area.

Italian immigrants eventually moved next door, with a culture worlds apart from the Chinese and the freewheeling Barbary Coast, yet they learned to get along. Many of the Italians earned their living by fishing and crabbing. At that time, the city ended at Jackson Square, but in the late 1800s the land was filled in and North Beach was born.

Today the Barbary Coast ventures have been replaced by some of the finest antique shops in the city, along with the four-star restaurant Quince and its sister, Cotogna. Coi, another four-star restaurant, is located in the shadows of the seedy Broadway strip.

Fisherman's Wharf as we know it today began in 1916 when Castagnola's graduated from a crab stand to a full-service restaurant, setting the stage for what has become one of the biggest tourist attractions in the city - and the United States.

In later years, Square 5 became a petri dish of experimentation and change, giving rise to the Beat Generation in the late 1940s and 1950s. That led to San Francisco becoming the center of the hippie movement in the 1960s and a mecca for gays in the 1970s.

Considering how all these threads are woven together in Square 5, it was difficult to choose one place as the standout. Yet in the end we picked Graffeo Coffee because it represents the type of creative and entrepreneurial spirit the city embraces.

Opened in 1935, Graffeo is the oldest artisan roaster in the United States. It speaks to our love of innovation - that goes back to Molinari, which made the first air-dried salami in 1896. You could argue that this creative spirit is what has made the Bay Area the think tank of the Internet.

The Beatnik era and the coffeehouse culture are important signposts of the city's development. And Square 5 is the incubator of change that is San Francisco.